Last week a report outlining the economic importance of the film industry in Holland was officially presented to government representative Boris van der Ham. The report, commissioned by Filmwereld , an association of filmmakers, theaters, rental stores and other distribution channels, shows a clear but grim picture: in 2005 the film industry lost over 10% (82 million Euro) in revenue through illegally downloaded films. With the report, the association asks for governmental support to help fight the infringement of copyrights. While downloading films is not a crime in Holland, uploading is. Most P2P networks work on the principle that you have to open up your computer for uploading if you want to download, effectively making you a willful accomplice. The Dutch government has alreeds indicated in November that it shares the indicated concerns and that it will investigate the matter (see article in NRC).
While the claims on copyright infringements are legitimate, the whole debate brings back memories of what happened in the music industry, no more than a couple of years ago. A similar sales pattern indicated a clear change in the habbits of consumers. But instead of taking this change for a fact and adapting to this new reality, captains of industry nervously checked their balance sheets and focussed all their attention on legal actions. What followed is history. Traditional powerhouses lost their dominant positions while new players came up with legal alternatives that worked. By july this year Apple announced it had sold more than 3 billion songs, or an average of 87 thousand an hour since it opened in 2003. Granted, this development has not been able to put a complete halt to declining sales in the music industry and illegal downloading and sharing of music still exists. but the point is, there is a legal alternative that allows more music to be available to more people than ever before.
Improved bandwidth is now opening up doors to a similar situation in the film industry. I can find practical any film I want for free on the internet and I can watch it the same evening, if I have the stamina to endure the lousy audio quality, Spanish subtitles and my guilty consciousness…
So instead of focusing our attention exclusively on the illegal side of downloading we should applaud the fact that there is so much demand for the material and provide this hungry audience with some decent legal alternatives. Of course Itunes will be a big player on the VOD scene and so will others that cater blockbusters to large audiences. It will be harder to find distributors of arthouse films that can only exist at the very end of the Long Tail. Nevertheless there are interesting experiments going on that we will watch closely like the Spanish endeavor Filmotech. This VOD site brings spanish film affectionados high quality film through a platform operated by the spanish filmproducers themselves. The Norwegian Film Institute already launched itâ€™s VOD outlet www.filmakivet.no in the fall of 2004. Itâ€™s mission is to â€˜preserve, make available, and promote Norwegian filmsâ€™ through the creation of a high quality distribution channel.
So yes, as content providers we should protect the rights of the creator and enforce our copyright laws. But it is in their best interest as well that we should provide serious alternatives to illegal downloading. And the alternative is to provide the highest quality formats in an easy to use environment with lots of added value services such as recommenders and ratings. I for one would be very happy to pay say 4 euro to be able to watch Cidade de Deus in a decent 2k version with readable english subtitles.